A Local Government Currently Has a Tax Base of $4

question 190

Multiple Choice

A local government currently has a tax base of $4 billion and a tax rate of 5 percent. If the tax rate is increased to 6 percent, the tax base will decrease to $3.5 billion. If the goal is to maximize tax revenues the tax rate should be

• A)lowered below 5 percent.
• B)kept at 5 percent.
• C)raised to 6 percent.
• D)abolished.

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Definitions:

Temperature

A physical quantity that expresses the subjective perceptions of hot and cold, measured by a thermometer in units like Celsius, Fahrenheit, or Kelvin.

Temperature

A measure of the average kinetic energy of the particles in an object or system, indicating how hot or cold the object is.

Increased

Increased refers to a situation or condition becoming larger, greater, or higher in number or amount.

X-variable

An independent variable in mathematical functions and experiments that can be changed to observe its effect on the outcome.